Take advantage of the day. Strike while the iron is hot. Get your butt in gear.
All of these expressions (and many more) emphasize the need to act now instead of letting the grass grow under our feet.
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Chris Versace, whose recommendations form the basis of TheStreet's Pro Portfolio, has decided to take his time and cash in while the sun shines.
The veteran trader detailed his latest stock purchase plan in a recent TheStreet Pro column.
This includes the acquisition of shares in financial heavyweight American Express. (AXP) cloud computing platform company ServiceNow (NOW) organic light emitting diode manufacturer Universal Display (OLED) and united rentals (URI) the largest equipment rental company in the world.
“Following weaker-than-expected December PPI readings for both the headline and headline numbers, we are taking advantage of the recent market pullback and other factors to acquire more shares of AXP, NOW , OLED and URI,” said Versace.
Fund manager buys more American Express
The producer price index rose 0.2% in December, the Bureau of Labor Statistics said on Jan. 14, less than the previous month's 0.4% increase and below the consensus estimate of 0.4 %.
The core PPI, which excludes food and energy, was stable compared to the forecast for a 0.3% increase. Excluding food, energy and business services, the measure rose 0.1%.
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The BLS is scheduled to release the consumer price index on January 15 and is expected to show monthly gains of 0.3% in both the headline and core readings and respective annual inflation rates of 2.9% and 3 .3%.
“We recognize that we still have Wednesday's December Consumer Price Index report ahead of us, but the December PPI suggests that the recent rise in inflation expectations may have been excessive,” Versace said.
To be clear, he added, December's year-over-year figures of 3.3% for headline PPI and 3.5% for core PPI “still indicate that inflation pressures are tough and mean the Fed will be in no rush to ease.” monetary policy, but it is enough to silence those calling for further rate hikes,”
“It's that relief that we're seeing in the market,” he said.
Versace noted that the stronger labor market and real wage growth offer support for continued consumer spending among company members, which should benefit American Express.
“We are also encouraged by recent travel commentary from Delta Air Lines (give it) and others that leverage the strengths of American Express,” he said.
American Express is scheduled to report its fourth-quarter results on January 24. The company's shares are up almost 65% from a year ago.
In October, the company earned $3.49 and revenue hit a record $16.6 billion.
Following the purchase, American Express represents around 1.5% of the portfolio.
Catalysts Drive Optimism in ServiceNow and Universal Display Stock
Regarding ServiceNow, Versace said it has used pullbacks in the stock to increase the size of TheStreet Pro Portfolio's position and “we view this move as doing more of that.”
“What we're looking to capture with NOW stock is the growing shift in ai spending across the enterprise, which should drive favorable pricing, margins and earnings for ServiceNow,” he said.
ServiceNow, which will report its fourth-quarter results on January 29, has seen its stock rise 40.4% over the past year.
President and CEO Bill McDermott said <a target="_blank" href="https://www.investors.com/news/technology/servicenow-stock-now-stock-mcdermott-interview-artificial-intelligence/”>Business diary for investors which hopes the company will be the “control tower for ai business transformation.”
With Universal Display, Versace said the smartphone market won in the December quarter and noted that Samsung (SSNLF) will begin mass production of the world's first rollable organic light-emitting diode display for laptops in April.
Due to their high-quality color reproduction and slim profile, organic light-emitting diodes are commonly used in displays for devices such as smartphones and televisions.
Samsung will launch this product in June with its ThinkBook Plus G6 rollable laptop, which it showed off at CES last week.
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“This app is another example of how connected device manufacturers are expanding screen size to offer a richer consumer experience,” Versace said.
“Just like we're starting to see in smartphones and tablets, we're likely to see other device companies follow, making this another avenue of growth for organic light-emitting diodes and universal display.” , he added.
Shares of Universal Display, which will report earnings on Feb. 27, are down 18.5% from a year ago.
The purchases bring ServiceNow and Universal Display's weighting in the portfolio to 3% and 3.85%, respectively.
ai growth is good news for United Rentals
And finally, there is United Rentals.
Versace said he had some reasons for adding the company to the Portfolio's position. The biggest was the optimistic outlook for non-residential construction, “which continues to benefit from infrastructure spending as well as other construction efforts.”
A report from global real estate services company JLL found that global demand for data centers is expected to increase this year, it said, “not surprising given the high spending we've seen from Big tech.”
Because of that continued spending, JLL forecasts base growth of 15% on a compounded annual basis (CAGR) through 2027, but the company said it could reach a CAGR of 20%.
“We view this as offering a stronger outlook for the housing market, which will continue to be affected by interest rates and mortgage rates remaining higher for longer, undermining housing affordability,” he continued.
Versace also noted the eventual rebuilding as California recovers from the current wildfires and the recent announcement that United will acquire competitor H&E Equipment Services. (SONG) in a transaction of 4.8 billion dollars.
“The acquisition is expected to increase URI's rental fleet by nearly 64,000 units, as well as approximately $230 million of non-rental fleet,” it said.
Following the purchase, United Rentals represents approximately 3.5% of the portfolio.
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